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CollectionsWhen you place accounts, you should be able to see what happens to every one of them. Here's TSI's standard 7-step workflow, the rules behind each step and the records you can audit.
At TSI, a placed account moves through 7 steps: file checks, loading and scrubs, the first notice, contact and payment, holds for disputes and escalation events, credit reporting if the client directs it, and close and return with a reason code. Each step leaves a dated record the client can audit.
This is TSI's standard workflow for third-party collections placements in Accounts Receivable Management (ARM). Where a client's contract sets different timing, reports or approvals, the contract governs.
| Step | What happens | What the client gets |
|---|---|---|
| 1. Intake | Files arrive by secure transfer and pass quality checks before anything loads | An acknowledgement report of accounts and dollars received |
| 2. Load and scrub | Accounts load, link by consumer and pick up restriction flags | Exceptions sent back for research |
| 3. First notice | The validation notice goes out, generally within 48 hours of placement | Letter text the client approved |
| 4. Contact and payment | Calls, letters and self-service payment; settlements only within the client's authority | Remittance on the contract schedule, by ACH or wire |
| 5. Holds | Disputes, complaints, bankruptcy, cease requests, attorney representation and deaths stop activity | A daily dispute list and status updates |
| 6. Credit reporting | Only when the contract directs it, after a waiting period, with exclusions | Monthly furnishing, with corrections and deletions |
| 7. Close and return | Supervisor review, a reason code, then return | A closed-and-returned accounts report |
Placement files come in over SFTP with SSH key authentication, to a transfer site TSI hosts. Before a file goes live, the team spot-checks the beginning, middle and end of the batch and counts the records, consumers and accounts in it.
The checks also catch duplicate accounts and files, balances above the agreed maximum, and totals that don't match the file's header or trailer. If more than 2% of records are missing demographic data, programmers review the file before it loads.
TSI then sends an acknowledgement report listing the accounts and dollars received. Each month, placements are reconciled against the client's records, and any discrepancy gets researched with the client's team.
The collection system links accounts that belong to the same consumer. One person gets one representative, and payments post to the right account.
Accounts that carry a restriction are flagged before anyone calls. An account can be tagged so no voicemail is left, for example, or so its calls count against a state's weekly limit. Bankruptcy and deceased scrubs run at load. (For how federal call limits are counted, see Reg F call limits.)
Every action on an account, including automated ones, is time- and date-stamped with the user's ID.
The first letter carries the validation notice and the disclosure that it comes from a debt collector attempting to collect a debt. TSI's standard is to generate it within 48 hours of placement, and some contracts set a shorter window. TSI's compliance team reviews letter text, and the client approves it before use.
Regulation F lets a collector put the validation information in the initial communication or send it "within five days of that initial communication" (12 CFR 1006.34(a)(1)). The validation period then runs until 30 days after the consumer receives, or is assumed to receive, the notice (12 CFR 1006.34(b)(5)).
A second letter goes out when an account is still unresolved after 30 days. Other letters follow events: a payment plan set-up, a reminder, a returned check or a broken promise.
Representatives work from a 4-phase call model: introduction, getting the facts, negotiating a solution, and closing with or without a promise. The model prompts the required disclosures, and it asks for the full balance before a payment plan comes up.
Settlements happen only within the client's authority. That means written approval of each offer, or blanket parameters the client sets in advance. TSI's fee is calculated on the amount collected under the settlement.
Collections are remitted on the contract's schedule (daily, weekly, twice a month or monthly) by ACH or wire. Statements and remittance files arrive through the client portal or another agreed electronic method.
A dispute puts the account on hold until it's answered. TSI separates any undisputed balance from the disputed part and adds the account to a daily dispute report. Client Services sends that list to the client for validation documents, or to confirm a payment the consumer says went directly to the client.
When the documents arrive, TSI mails them with a cover letter and follows up by phone to confirm they arrived. If the balance turns out to be invalid, the account closes and returns.
The rule for written disputes is specific. A collector that receives one within the validation period "must cease collection of the debt, or any disputed portion of the debt," until it sends verification or a copy of a judgment (12 CFR 1006.38(d)(2)).
Complaints take a stricter path. Collection stops, the complaint is logged and Consumer Affairs works it with TSI's General Counsel, usually within 1 business day. Consumer Affairs also forwards it to the client, and collection stays suspended until the client clears it. How TSI handles complaints covers the rest of that process.
Escalation events stop activity too. When TSI learns of a bankruptcy, a cease-and-desist request, attorney representation or a death, the account is coded, outreach is suppressed and the status goes back to the client's system of record: the same day where the contract sets that up, or in the next daily file.
TSI also suspends activity when the client asks, or when a consumer raises a legal defense, and tells the client within 5 working days.
TSI furnishes to Experian, Equifax and TransUnion only when the client's contract directs it. Some clients prohibit reporting, and then no account on their program is reported.
Before an account can be reported, it's validated and confirmed as active and collectible. Accounts flagged for bankruptcy, death, Servicemembers Civil Relief Act protection or an open dispute are excluded, along with anything outside the client's minimum balance or placement-age rules.
TSI's usual practice is to wait 35 days before the first report, so the first notice has arrived and the full 30-day dispute window has run. Regulation F sets the floor: no furnishing until the collector has spoken with the consumer, or mailed a notice and waited "a reasonable period of time to receive a notice of undeliverability" (12 CFR 1006.30(a)(1)).
Updates go to the bureaus monthly, with manual updates and deletions daily. Single removals, and disputes a bureau forwards, run through the bureaus' e-OSCAR system.
The Fair Credit Reporting Act adds duties at this stage. A furnisher that learns a consumer disputes an item "may not furnish the information to any consumer reporting agency without notice that such information is disputed by the consumer" (15 U.S.C. 1681s-2(a)(3)). When a bureau passes on a dispute, the furnisher has to investigate and report the result back (15 U.S.C. 1681s-2(b)(1)). Furnishers also need written policies on the accuracy and integrity of what they report (12 CFR 1022.42(a)).
Where the rule stands
Accounts close when they're paid in full, settled, recalled, in bankruptcy, confirmed deceased with no estate, or uncollectible (the consumer can't be found, can't pay because of hardship, or refuses when legal action isn't approved).
A supervisor reviews each account before it closes, and a reason code goes on the record.
A recall takes effect when the client sends it: collection stops, and the account returns by the method and on the schedule in the contract. In TSI's standard terms, recalled accounts close without a fee unless money was collected before the recall.
The client gets a report of every closed and returned account with its reason, monthly by default or daily if the contract calls for it.
Every step above leaves something to check: the acknowledgement report and monthly reconciliation, time-stamped account notes, the daily dispute list, the complaint record, escalation status updates, remittance files and the closed-and-returned report. Call recordings and quality scores are covered in how collection calls are monitored, scored and root-caused.
What happens to the data after the contract ends is its own question, answered in what to ask a collection agency about your data at contract end.
The full question set, with weights and a scoring sheet, is in what a collection services RFP should include, and how to score it. Licensing questions are in how to verify a collection agency's licenses.
General information, current as of Nov 5, 2026. It isn't legal advice. Rules change and differ by state, so check the sources linked here and talk to your own counsel before you act on it.
The Recovery Performance Diagnostic takes one portfolio, stage or segment and covers baseline economics, channel strategy, complaint and risk analysis, and a carve-out design that converts to a measured pilot.
